CALGARY, Oct. 1, 2012 /CNW/ - Keyera Corp. (TSX:KEY) (TSX:KEY.DB.A) ("Keyera") announced today plans to further enhance recoveries of ethane and other natural gas liquids ("NGLs") from the raw gas stream at the Rimbey gas plant. The project includes installation of a new 400 million cubic feet per day turbo expander unit and construction of a 34 kilometre, six-inch diameter ethane pipeline to connect to the Alberta Ethane Gathering System.
The project is estimated to cost $210 million and will allow Keyera to recover over 90% of the ethane at the Rimbey gas plant. Upon completion of the project, Keyera expects to extract up to 20,000 barrels per day of ethane through the turbo expander unit. The extracted ethane will be sold to a large consumer in Alberta under a long term sales agreement.
Keyera has also secured a long-term, fee-for-service processing agreement that includes a significant area dedication with a large producer and is currently in discussions with other producers interested in contracting processing capacity at the Rimbey gas plant.
"We are excited about this expansion opportunity," said David Smith, President and Chief Operating Officer of Keyera. "With increased liquids-rich drilling activity in the area, raw gas processing capacity with deep-cut liquids extraction capability is in demand. The Rimbey gas plant provides unparalleled processing services for our customers, including NGL fractionation, rail and truck loading facilities, and an NGL pipeline connection to the Edmonton/Fort Saskatchewan NGL hub."
Initially, the turbo expander will be run in place of the existing lean oil NGL recovery system at the Rimbey gas plant. However, in the future, with relatively low additional capital investment, there would be an opportunity to run both the lean oil system and the turbo expander unit, which would significantly increase the plant's processing capacity.
Subject to regulatory approvals, the construction phase of the plant expansion is anticipated to begin in the fourth quarter of 2012, with start-up expected in late 2014.
The Rimbey gas plant is Keyera's largest natural gas processing facility and a key energy complex in west central Alberta. Keyera is the operator of the plant and has a 97% ownership interest in the facility. With licensed raw gas processing capacity of over 400 million cubic feet per day and over 2,500 kilometres of gathering pipelines, the plant's extensive capture area allows it to provide energy processing services to a large number of producers in the area.
About Keyera Corp.
Keyera Corp. (TSX:KEY) (TSX:KEY.DB.A) operates one of the largest natural gas midstream businesses in Canada. Its business consists of natural gas gathering and processing as well as the processing, transportation, storage and marketing of NGLs, the production of iso-octane and crude oil midstream activities.
Keyera's gas processing plants and associated facilities are strategically located in the west central, foothills and deep basin natural gas production areas of the Western Canada Sedimentary Basin. Its NGL and crude oil infrastructure, including pipelines, terminals and processing and storage facilities, as well as its iso-octane facility, are located in Edmonton and Fort Saskatchewan, Alberta, a major North American NGL hub. Keyera markets propane, butane, condensate and iso-octane to customers in Canada and the United States.
This document contains forward-looking statements based on management's current expectations and assumptions relating to the turbo expander project, Keyera's business, the environment in which it operates and the future operations and performance of the assets. As these forward-looking statements depend upon future events, actual outcomes may differ materially depending on factors such as: obtaining all necessary approvals and consents for the installation of the turbo expander unit, the ethane pipeline connection and all associated facilities; satisfaction of all conditions in both the long-term ethane sales agreement and the processing agreement entered into in support of the project; construction and input costs; construction scheduling variables; future operating results of the assets; Keyera's ability to execute its strategic initiatives; weather conditions; commodity supply/demand balances and prices; activities of producers, competitors, customers, business partners and others; overall economic conditions; access to capital and financing alternatives; operational risks associated with natural gas processing and NGL extraction; regulatory approvals for future plant expansion opportunities; and potential delays or changes in plans with respect to development projects or capital expenditures or the results therefrom; the legislative, regulatory and tax environment; and other known or unknown factors. There can be no assurance that the results or developments anticipated by Keyera will be realized or that they will have the expected consequences for or effects on Keyera.
Additional Information For additional information on these and other factors, see Keyera's public filings on www.sedar.com. The information provided in this release is given as of the date hereof.
SOURCE: Keyera Corp.
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